Non-sponsored life insurance agents in Ontario must now disclose where they place most of their business when they renew their licenses.
In an e-newsletter published on March 11, the Financial Services Commission of Ontario (FSCO) indicated that in the spring of this year non-sponsored life insurance agents will have to provide the name of the insurance company with which they conduct — or expect to conduct — most of their business.
FSCO refers to this company as the "primary insurer" and says the information it collects from agents will be used for "notification purposes", such as when an agent fails to maintain Errors and Omission (E&O) insurance or to complete his or her continuing education (CE), or should there be suitability issues on a renewal application.
In the same newsletter, the provincial insurance regulator points out that companies are responsible for ensuring that an agent holds a valid license before they release any commissions. If advisors do not hold E&O coverage or have not met their CE requirements, their licenses will not be valid, and insurers cannot pay them.
Agent compliance system
"In addition to having an agent compliance system in place, the role of the primary insurer is to assist FSCO to resolve any outstanding agent compliance issues and, where possible, help and avoid the need for disciplinary action," reads the message. "FSCO will provide insurers with the names of agents who have listed that insurer as their primary insurer."